Finance House P.J.S.C.

Condensed

Notes to the condensed consolidated interim financial information For the three-month period ended 31 March 2023

1 Legal status and principal activities

Finance House P.J.S.C. (“the Company”) is a Public Joint Stock Company incorporated in Abu Dhabi, United Arab Emirates (U.A.E.) in accordance with the provisions of the U.A.E.

The Company was initially registered in compliance with relevant UAE Federal Law No. (2) of 2015, as amended. As of 2 January 2022, the Company is subject to compliance with UAE Federal Law No. (32) of 2021, which replaces UAE Federal Law No. (2) of 2015, as amended. The condensed consolidated interim financial information has been prepared in accordance with the requirements of the applicable laws and regulations, including UAE Federal Law No. (32) of 2021, the Decretal Federal Law No. 14 of 2018 regarding the Central Bank and Organization of Financial Institution and Activities and under authority of resolutions of the Board of Directors of the U.A.E. Central Bank relating to Finance Companies. The shareholder of the Company is currently in the process of amending the statutory documents, to reflect the changes required due to application of the UAE Federal law No. (32) of 2021.

The registered head office of the Company is at P.O. Box 7878, Abu Dhabi, U.A.E.

The Company was established on 13 March 2004 and commenced its operations on 18 July 2004. The Company performs its activities through its head office in Abu Dhabi and its Abu Dhabi, Dubai, and Sharjah branches. The Company and its subsidiaries (together referred to as the “Group”) are engaged primarily in investments, consumer and commercial financing and other related services.

The entity is listed on the Abu Dhabi Securities Exchange (Ticker: FH).

On 24 October 2018, management of Islamic Finance House (“the Subsidiary”) submitted an adjustment plan for restructuring the Subsidiary to the Central Bank of UAE. The adjustment plan has been approved by the Board of Directors on the 6 of February 2019 and by the Central Bank of the UAE on 10 October 2019. The purpose of the plan is to adjust the activities of the subsidiary to meet the requirements of the newly issued regulations for finance companies. On 12 October 2020, Central Bank of the UAE has licensed Finance House L.L.C. (formerly known as Islamic Finance House P.J.S.C.) to conduct financing business specified in Article (10) of the Finance Companies Regulation

2 Basis of preparation

This condensed consolidated interim financial information of the Group is prepared on an accrual basis and under the historical cost basis except for certain financial instruments and investment properties which are measured at fair value.

This condensed consolidated interim financial information is prepared in accordance with International Accounting Standard 34: “Interim Financial Reporting” issued by the International Accounting Standard Board (IASB) and comply with the applicable requirements of the laws in the U.A.E.

This condensed consolidated interim financial information does not include all the information and disclosures required in full consolidated financial statements and should be read in conjunction with the Group’s consolidated financial statements for the year ended 31 December 2022. In addition, results for the period from 1 January 2023 to 31 March 2023 are not necessarily indicative of the results that may be expected for the financial year ending 31 December 2023

As required by the Securities and Commodities Authority of the U.A.E. (“SCA”) Notification No. 2624/2008 dated 12 October 2008, accounting policies relating to financial assets, cash and cash equivalents, Islamic financing and investing assets and investment properties have been disclosed in the condensed consolidated interim financial information

Notes to the condensed consolidated interim financial information (continued) For the three-month period ended 31 March 2023

2 Basis of preparation (continued)

IFRS 17 - Insurance Contracts

International Financial Reporting Standard (IFRS) 17, “Insurance Contracts” establishes principles for the recognition, measurement, presentation and disclosure of insurance contracts within the scope of the Standard. The objective of IFRS 17 is to ensure that an entity provides relevant information that faithfully represents those contracts. This information gives a basis for users of the financial statements to assess the effect that insurance contracts have on the entity’s financial position, financial performance and cash flows. This standard is effective for periods beginning on or after 1 January 2023.

The Group has not adopted IFRS 17 in the preparation of this condensed consolidated interim financial information The Group is in the process of implementation of IFRS 17 to comply with it and has submitted an application to Central Bank of United Arab Emirates (“CBUAE”) to seek an extension from application of IFRS 17 for the quarter. Pending such approval, the Group has continued with IFRS 4, “Insurance Contracts” in the preparation of this condensed consolidated interim financial information in the current period.

3 Significant accounting policies

The accounting policies applied in this condensed consolidated interim financial information is the same as those in the Group’s consolidated financial statements as at and for the year ended 31 December 2022 except for the new standards applicable during the period.

3.1 Application of new and revised International Financial Reporting Standards (IFRS) Standards, interpretations and amendments to existing standards that are effective in 2023

In the current period, the Group has applied the following amendments to IFRSs issued by the International Accounting Standards Board (“IASB”) that are mandatorily effective for an accounting period that begins on or after 1 January 2023. The application of some of these amendments to IFRSs has not had any material impact on the amounts reported for the current and prior periods but may affect the accounting for the Group’s future transactions or arrangements.

• Deferred Tax related to Assets and Liabilities arising from a Single Transaction (Amendments to IAS 12)

• Definition of Accounting Estimates (Amendments to IAS 8)

• Disclosure of Accounting Policies (Amendments to IAS 1 and Practice Statement 2)

These amendments do not have a significant impact on the condensed consolidated financial information and therefore the disclosures have not been made for them.